Kashinath ji
It works dis way...
in your salary component, you give 800 (or higher) allowance as conveyance so that they can travel from home to office (however they wish to - public bus/ train/ own car/bike)
When someone is using company bus, you need to charge them...
What happens with my frnd who goes in company bus,
she has to pay X amount pm against the facility...
Her salary component shows Conveyance as X
and this is deducted below and showed as Charge for Company provided transport...
So basically, you tell your employee they've been given the X amt as conveyance as per the rule, but since they're using company's transport, they would be paying that X amt to company and hence it is deducted...
Hope it helped :-)
From India, Mumbai
737It works dis way...
in your salary component, you give 800 (or higher) allowance as conveyance so that they can travel from home to office (however they wish to - public bus/ train/ own car/bike)
When someone is using company bus, you need to charge them...
What happens with my frnd who goes in company bus,
she has to pay X amount pm against the facility...
Her salary component shows Conveyance as X
and this is deducted below and showed as Charge for Company provided transport...
So basically, you tell your employee they've been given the X amt as conveyance as per the rule, but since they're using company's transport, they would be paying that X amt to company and hence it is deducted...
Hope it helped :-)
From India, Mumbai
Dear Ankita ji,
If a company is in outskirt or out of city were can not be any kind of buses or any vehicle facility then people who are coming with their own vehicle are giving convienence reiumbursement.
If employee doesnt hav his vehicle he wil be given bus facility as an aspect of employee welfare or welfare aspect. Were there wil be no deduction in part of their salary.
This is the system of our company.
Regards
Kashinath.
From India, Bangalore
If a company is in outskirt or out of city were can not be any kind of buses or any vehicle facility then people who are coming with their own vehicle are giving convienence reiumbursement.
If employee doesnt hav his vehicle he wil be given bus facility as an aspect of employee welfare or welfare aspect. Were there wil be no deduction in part of their salary.
This is the system of our company.
Regards
Kashinath.
From India, Bangalore
In that case:
Amount spent on travel of 1 person on average, is included in CTC only and not in the monthly salary of person:
This is because CTC is Cost-To-Company and every single rupee that is costed to company is included in the CTC component. Training cost is not included coz training is not provided on regular basis. However bus charges are accrued on the company and is payable on regular monthly/weekly basis as the case. Hence bus charges are to be included in the CTC of the employee...
So say for eg, you wish to give a 3 lac CTC offer to an employee then -
if he has own vehicle, you can reimburse the cost and put it under travelling or such allowance
if he uses bus service, you can find the cost incurred by company per employee, and include it in the ctc as below:
(add)
Basic
DA
HRA
Medical Allowance
Other Allowance
-------------------------------------
Per month Salary
-------------------------------------
x 12 = Annual Salary
-------------------------------------
(add foll)
Gratuity
Bonus
PF contribution from Co
Cost of bus per employee
Other costs incurred
--------------------------------------
CTC
--------------------------------------
Hope it helped... :-)
From India, Mumbai
Amount spent on travel of 1 person on average, is included in CTC only and not in the monthly salary of person:
This is because CTC is Cost-To-Company and every single rupee that is costed to company is included in the CTC component. Training cost is not included coz training is not provided on regular basis. However bus charges are accrued on the company and is payable on regular monthly/weekly basis as the case. Hence bus charges are to be included in the CTC of the employee...
So say for eg, you wish to give a 3 lac CTC offer to an employee then -
if he has own vehicle, you can reimburse the cost and put it under travelling or such allowance
if he uses bus service, you can find the cost incurred by company per employee, and include it in the ctc as below:
(add)
Basic
DA
HRA
Medical Allowance
Other Allowance
-------------------------------------
Per month Salary
-------------------------------------
x 12 = Annual Salary
-------------------------------------
(add foll)
Gratuity
Bonus
PF contribution from Co
Cost of bus per employee
Other costs incurred
--------------------------------------
CTC
--------------------------------------
Hope it helped... :-)
From India, Mumbai
Hai Ankita ji,
Under payment of gratuity act, if an employee completes 4.8 yrs, were as in last year of 8 months abstract is more than 240 days but does not cross acc to sec 4 sub clause 1 of payment of gratuity that is 5 years is he is liable to claim gratuity under payment of gratuity act.
If yes, if any amendment or case law is there plz sujjest me.
Regards,
Kashinath.
From India, Bangalore
Under payment of gratuity act, if an employee completes 4.8 yrs, were as in last year of 8 months abstract is more than 240 days but does not cross acc to sec 4 sub clause 1 of payment of gratuity that is 5 years is he is liable to claim gratuity under payment of gratuity act.
If yes, if any amendment or case law is there plz sujjest me.
Regards,
Kashinath.
From India, Bangalore
[QUOTE=surisethe kashinath;1998387]Dear Kshinath,
You are partly right - Gratuity eligibility after an employee render a "Continuous Service" of 4 Yrs & 240 days" and Payment to him Actually arises only when he leaves the Estt. But a firm by " Accounting Standard " has to account this "Gratuity Liability" every year after working out the same by "Acturial Method" duly certified by an "Actuary" . Thus whether the gratuity is paid or not the amount involved is accounted in the books of accounts of a firm on "Accrual Basis" Therefore that much amount is CTC to that firm in respect of the employees individually who has become eligible as per the Act and whether it is paid or not but considered as that much is payable.
Now, what happens to this money. There are two/three methods:
1. Remit every year the "the incremental liability" to the Gratuity Fund Managers like LIC etc on certain formula. Who in turn will settle the Gratuity payment to the Leaving Employees as per the Gratuity Act. If a person leaves the Co. before becoming eligible, then that much proportionate money is a gain to the co. (This method is more or less like EPO.) The main difference is, this fund doesn't pay interest to the member employees.
2. Second method - Create a "Gratuity Fund" within the same co. and remit the accrued amount to that fund every year and settle payments thro' the fund as and when need arises This is like "exempted PF Trust" This is managed by the firm itself.
3. Keep the Gratuity fund within the Co., only create liability in the Accounts on "Accrual Basis" every year and settle the amount as per Gratuity Act.
All these popular three methods are in vogue among employers.
So as the Gratuity amount is proportionately charged as expenses in the firm's accounts it is a CTC.
Hope it is understandable.
kumar.s.
From India, Bangalore
You are partly right - Gratuity eligibility after an employee render a "Continuous Service" of 4 Yrs & 240 days" and Payment to him Actually arises only when he leaves the Estt. But a firm by " Accounting Standard " has to account this "Gratuity Liability" every year after working out the same by "Acturial Method" duly certified by an "Actuary" . Thus whether the gratuity is paid or not the amount involved is accounted in the books of accounts of a firm on "Accrual Basis" Therefore that much amount is CTC to that firm in respect of the employees individually who has become eligible as per the Act and whether it is paid or not but considered as that much is payable.
Now, what happens to this money. There are two/three methods:
1. Remit every year the "the incremental liability" to the Gratuity Fund Managers like LIC etc on certain formula. Who in turn will settle the Gratuity payment to the Leaving Employees as per the Gratuity Act. If a person leaves the Co. before becoming eligible, then that much proportionate money is a gain to the co. (This method is more or less like EPO.) The main difference is, this fund doesn't pay interest to the member employees.
2. Second method - Create a "Gratuity Fund" within the same co. and remit the accrued amount to that fund every year and settle payments thro' the fund as and when need arises This is like "exempted PF Trust" This is managed by the firm itself.
3. Keep the Gratuity fund within the Co., only create liability in the Accounts on "Accrual Basis" every year and settle the amount as per Gratuity Act.
All these popular three methods are in vogue among employers.
So as the Gratuity amount is proportionately charged as expenses in the firm's accounts it is a CTC.
Hope it is understandable.
kumar.s.
From India, Bangalore
Dear Kashinath,
There are also possibilities, employees using the company bus may go for reimbursement. Here it is a double expenses for the same employee.I would suggest to maintain a log sheet to track the employees using the company bus.It may result in discrepencies among employees as well. I feel the suggestion of Ms.Ankita is a good practice to include in the salary component.
Regards,
Kumar
From India, Chennai
There are also possibilities, employees using the company bus may go for reimbursement. Here it is a double expenses for the same employee.I would suggest to maintain a log sheet to track the employees using the company bus.It may result in discrepencies among employees as well. I feel the suggestion of Ms.Ankita is a good practice to include in the salary component.
Regards,
Kumar
From India, Chennai
Hi Kashinath ji,
Yes, a person claims gratuity after 5 years of service However if a person has worked for 4 years and 240 days, it is equivalent to 5 years.
Also after 5 years, months <6 is rounded off to previous year and >=6 is rounded of to next number.
Check gratuity Act
Hope it helped and sorry for delayed response.
From India, Mumbai
Yes, a person claims gratuity after 5 years of service However if a person has worked for 4 years and 240 days, it is equivalent to 5 years.
Also after 5 years, months <6 is rounded off to previous year and >=6 is rounded of to next number.
Check gratuity Act
Hope it helped and sorry for delayed response.
From India, Mumbai
Hai Ankita Ji,
Wishing you Happy New Year......... 2013.
Madam Ji, can you please guide me in which section of Gratuity Act it is mentioning that 4years 240 days can be rounded off as 5 years because according to section 4 sub clause 1 of Gratuity Act it is stating that an regarding payment of gratuity and its applicability it is mandatory to complete 5 years from his date of his joining to date of Joining.
Regards,
Kashinath
From India, Bangalore
Wishing you Happy New Year......... 2013.
Madam Ji, can you please guide me in which section of Gratuity Act it is mentioning that 4years 240 days can be rounded off as 5 years because according to section 4 sub clause 1 of Gratuity Act it is stating that an regarding payment of gratuity and its applicability it is mandatory to complete 5 years from his date of his joining to date of Joining.
Regards,
Kashinath
From India, Bangalore
Dear Sir/ Madam,
Can Any body help in this regard, regarding Payment of Gratuity Act Employees who are having 4 years 240 Days can claim for Payment of Gratuity Act. If yes please guide me regarding which section it is mentioning in Payment of Gratuity Act.
Kindly help in me in this regards
Kashinath
From India, Bangalore
Can Any body help in this regard, regarding Payment of Gratuity Act Employees who are having 4 years 240 Days can claim for Payment of Gratuity Act. If yes please guide me regarding which section it is mentioning in Payment of Gratuity Act.
Kindly help in me in this regards
Kashinath
From India, Bangalore
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